Fusion Finance: Audit Nightmare Over? CEO Reveals Turnaround Plan & HUGE Profitability Jump!

Author

Aditi Singh | Whalesbook News Team

Detailed Coverage:

Fusion Finance's CEO, Sanjay Garyali, announced that the company has resolved concerns related to loan covenant breaches. These breaches had previously led auditors to issue a "going concern" remark in Q2 FY25, questioning the company's ability to continue operating. Covenants are financial conditions set by lenders to ensure a borrower's financial health. Garyali indicated that normal audit remarks are expected from FY27 onwards, with improvements already visible.

The company has seen significant financial recovery. Gross Non-Performing Assets (GNPA) have decreased to 4.5-4.6%, and collection efficiency has risen to approximately 99%. Fusion Finance anticipates visible profitability in the second half of FY26. A Rs 400 crore rights issue has been completed and utilized for disbursements, with a second tranche of Rs 400 crore anticipated by mid-December 2025. This strengthens the Capital Adequacy Ratio (CAR) to over 31%. The new microfinance portfolio, comprising 65% of the total, adheres to stricter credit guardrails, focusing on better-quality, lower-leveraged customers. The SME business is also poised for growth.

**Impact**: This news signals a substantial turnaround for Fusion Finance, boosting investor confidence and indicating a return to stability and profitability. It could positively influence sentiment within the microfinance and broader NBFC sector in India, suggesting that companies facing similar challenges can navigate them successfully.

Impact Rating: 7/10